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Private equity-backed software group Visma has chosen London over Amsterdam for the planned initial public offering of the €19bn software company next year, scoring a rare win for the UK’s beleaguered stock market.
British buyout firm Hg has owned Visma, which provides small to medium-sized businesses with accounting and payroll software, since 2006 when it took the company private at a valuation of about £380mn.
Since then the UK-based private equity firm has repeatedly reinvested in Visma through its newer funds and cashed out some of its holdings through sales to external backers.
Hg currently owns about 70 per cent of Visma with its co-investors, with the remainder owned by minority shareholders including Singapore’s GIC and US private equity group TPG.
Visma previously considered pursuing an IPO in 2023 but instead opted for a private share sale to investors including Jane Street and Altaroc in a transaction that valued the company at €19bn.
However the business, which has grown through 350 bolt-on acquisitions and last year reported €185mn in pre-tax profits off €2.8bn in revenues, is now potentially too big to keep fully private, people familiar with the discussions said. Hg plans to retain a stake in Visma long-term, they added.
The decision to proceed with a listing in London early next year is provisional and contingent on the implementation of promised reforms by the government and the stock exchange needed to outweigh complications caused by Brexit, the people said.
London’s stock exchange has been squeezed by a lack of new listings and steady flow of exits from large companies shifting their primary listings to New York or accepting takeover offers.
Last year 88 companies delisted or transferred their primary listing from London’s main market, with only 18 taking their place. So far this year there have been just three IPOs on the country’s main market with a combined market capitalisation at listing of less than £100mn, according to data from the London Stock Exchange.
London won out for the Visma IPO because of its deep capital markets and the presence of more investors who focus solely on UK stocks than those buying exclusively Dutch equities, the people familiar with the deliberations said.
But they added that the implementation of planned reforms was essential, such as allowing companies with a euro share price to be included in FTSE indices.
Banks will be invited to pitch for the listing this week, the people said.
Visma and Hg declined to comment.